Diabetes is characterized by the destruction and/or relative dysfunction of insulin-secreting beta-cells in the pancreatic islets of Langerhans. Consequently, considerable effort has been made to understand the physiological processes governing insulin production and secretion in these cells and to elucidate the mechanisms involved in their deterioration in the pathogenesis of diabetes. To date, considerable research has exploited clonal beta-cell lines derived from rodent insulinomas. Such cell lines have proven to be a great asset in diabetes research, in vitro drug testing, and studies of beta-cell physiology and provide a sustainable, and in many cases, more practical alternative to the use of animals or primary tissue. However, selection of the most appropriate rodent beta cell line is often challenging and no single cell line entirely recapitulates the properties of human beta-cells. The generation of stable human beta-cell lines would provide a much more suitable model for studies of human beta-cell physiology and pathology and could potentially be used as a readily available source of implantable insulin-releasing tissue for cell-based therapies of diabetes. In this review, we discuss the history, development, functional characteristics and use of available clonal rodent beta-cell lines, as well as reflecting on recent advances in the generation of human-derived beta-cell lines, their use in research studies and their potential for cell therapy of diabetes.